Starling Bank has announced that it is upgrading its bank accounts for businesses and sole traders with new features, including unsecured loans of up to £250,000, an increase in its overdraft limits from £10,000 to £150,000, more competitive overdraft rates and a custom-built tax and financial management toolkit.
As part of the changes, Starling is launching its first paid for features for businesses, providing access to a Business Toolkit, costing £7 per month for sole traders and £12 per month for limited companies.
The bank’s accounts for limited businesses and sole traders will remain free. But business owners will be able to opt for a paid-for Business Toolkit account that includes tools to track invoices, monitor cash flow, keep track of how much tax and VAT they owe, submit VAT returns through HMRC Making Tax Digital-compliant software and more.
Starling’s new unsecured term loan for business, offering from £5,000 to £250,000 over one to five years, will be available to limited companies that have been trading for at least 18 months on application direct to the bank. The interest rate offered will be based on an assessment of the business and the representative APR is 7% (fixed) for loans up to £25,000. For loans above £25,000, the bank’s rates are provided upon application.
The maximum overdraft limit available for eligible limited companies is being raised from £10,000 to £150,000. Starling is replacing its flat rate of 15% EAR (variable) with a rate of 5%, 10% or 15% EAR (variable), based on our assessment of each business. The representative EAR is 10% (variable). Customers will pay an annual fee of 1.5% (minimum fee £50) of any agreed overdraft limit, charged at initial set up. Sole traders can apply for an overdraft valued from £250 up to £10,000 at the existing rate of 15% EAR (variable).
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